Wednesday, January 8, 2014

People in health care don't like it when numbers emerge that are uncomfortable.  Take these, issued today by the Massachusetts Health Policy Commission in its latest report on the drivers of the high cost of care in our state.

Variation, particularly when not correlated to quality of outcome, is particularly troublesome for some incumbents.  Academic medical centers often have their answer, but as the HPC explains, it doesn't hold water:

One oft-cited theory for the cause of this variation is that certain types of hospitals, such as those that teach physician residents and fellows, must incur additional expenses to support their mission. However, the difference in median expenses per discharge between teaching hospitals and all hospitals ($1,030) was less than the difference between individual teaching hospitals ($3,107 between the 75th percentile and 25th percentile teaching hospitals). Moreover, there were a number of teaching hospitals that incurred fewer expenses per discharge than the statewide all-hospital median of approximately $9,000 per discharge.

So perhaps the high cost ones will now revert to the usual squawking: "This isn't fair. The data are wrong.  Our patients are sicker."  Except here, the data are the best that could be available--all the claims for all the hospitals and all the payers in the state--even adjusted for wages.  And the acuity of patients across the spectrum of academic medical centers does not vary widely--but, just in case, the numbers are case-mix adjusted.

This report is a good step forward.  Now, if the HPC were to just put names under each column, instead of leaving them unmarked, it could take a major step forward in two of its own policy recommendations:

--Fostering a value-based market in which payers and providers openly compete to provide services and in which consumers and employers have the appropriate information and incentives to make high-value choices for their care and coverage options; and

--Enhancing transparency and data availability necessary for providers, payers, purchasers, and policymakers to successfully implement reforms and evaluate performance over time.


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